Historical revisions in world cotton stocks jolt market

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• The new supplies reported in USDA’s April 10 World Agricultural Supply and Demand Estimates, raised world ending stocks to an extremely bearish 66.1 million bales and immediately sent December 2012 cotton futures lower.

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A huge increase in estimated world ending stocks, based on cotton discovered in inventory in India, jolted the market in early April.

The new supplies reported in USDA’s April 10 World Agricultural Supply and Demand Estimates, raised world ending stocks to an extremely bearish 66.1 million bales and immediately sent December 2012 cotton futures lower that day.

“We were thrown a bit of curveball in those numbers,” said O.A. Cleveland, professor emeritus, Mississippi State University, speaking at the Ag Market Network’s April conference call. “The huge increase in ending stocks put the bears back in control of the market.”